Plastic bag levy adds R1.1bn to govt coffers | Fin24
 
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Plastic bag levy adds R1.1bn to govt coffers

Oct 28 2014 18:09
Donwald Pressly

The plastic shopping bag levy was introduced in 2004 as a mechanism to manage the problem of plastic bags which ended up as wind-blown litter on fences, trees, the open veld or in waste facilities. (Pic: Fin24)

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Cape Town - The total quantum of funds collected since the introduction of the plastic bag levy scheme in 2003 up to August this year is R1.1bn, Finance Minister Nhlanhla Nene has told parliament.

Replying to a question from DA MP Tim Brauteseth, who asked what government departments had benefited from this revenue, Nene said in 2004/05 R41m was collected. By 2009/10 this jumped to R110m while in 2013/14 R169m was collected. So far this year R42m has been collected.

The minister acknowledged that only a fraction of the money collected has gone to the department of environmental affairs. Over the last 10 years R215m has been granted to the department.

He explained that all money received by the national government including all tax revenues collected must be deposited into the national revenue fund, as required by the constitution.

The levy was introduced at a modest 3 cents a bag in 2004, payable by plastic bag manufacturers and importers. It increased to 4c per bag in April 2009 and from the beginning of April 2013 it rose to 6c a bag. Nene said: “It is necessary to increase it from time to time to ensure that inflation does not erode the real value of the tax.”

The plastic shopping bag levy was introduced by then minister Valli Moosa in 2004 as a mechanism to manage the problem of plastic bags which end up as wind-blown litter on fences, trees, the open veld or in waste facilities.

Nene pointed out that as the national revenue fund is a general fund from which appropriations are made “there is no earmarking of funds collected… it is not possible to draw a direct link between the amount collected for a specific tax or levy with any specific expenditure”.

However, a section 21 non-profit company Buyisa-e-Bag was established to promote plastic bag recycling, he reported. This company was wound up in 2010/11 and its functions have now been taken over by the environmental affairs department under the environmental sector programmes and projects programme.

The levy has cut the use of plastic bags from 10 billion “down to four billion plastic shopping bags per year", a reduction of between 45% to 75% of plastic bags used per year, said Nene.

The department has established 15 plastic buy-back centres and supports 25 existing facilities.


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